Alif Construction Vs ITO (ITAT Mumbai)
ITAT Mumbai held that provisions of Section 43CA of the Income Tax Act are effective only from 1st April 2014. Accordingly, the same are not applicable when part payment was received in 2010.
Facts- The Assessee being a partnership firm engaged in the business of construction activities as a builder and developer, had shown its total income at Rs. Nil by filing its return of income for the AY under consideration on dated 26.11.2014, which was selected for scrutiny under CASS.
During the assessment proceedings, AO on verification of copy of sale agreements executed by the Assessee during the AY 2014-15, found the Assessee had executed 3 sale agreements, out of which sale consideration received by the Assessee for 2 agreements/properties was less than the stamp duty valuation.
AO by observing that since valuation of the property by the Assessee was less than stamp duty value and as provisions of Section 43CA are applicable in this case, vide notice dated 06.12.2016 u/s. 142(1) show caused the Assessee as to why difference of Rs. 27,23,000/- should not added to the total income.
Post reply, AO made addition. Commissioner confirmed the addition. Being aggrieved, the present appeal is filed.
Conclusion- It is an admitted fact that the provisions of Section 43CA were introduced vide finance Act 2013 and made applicable w.e.f. 01.04.2014 and the CBDT vide circular no. 3/2014 dated 24.01.2014 duly clarified that amendment made vide finance Act 2013 will take effect from 1st April, 2014 and will, accordingly, apply in relation to the assessment year 2014-15 and subsequent assessment years.
Held that the Assessee sold the same on the same consideration amount as fixed in 2010, to the persons of particular community, we for proper and just decision of the case and for ends of substantial justice, are inclined to direct the assessing officer to refer the capital assets/properties under consideration to District Valuation Officer as per the provisions of section 50C of the Act.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal has been preferred by the Assessee against the order dated 29/12/2016, impugned herein passed by the National Faceless Appeal Centre(NFAC) Delhi/Ld. Commissioner of Income Tax(Appeals) (in short „the Act’) u/s 250 of the Income Tax Act 1961 (in short „the Act’) for AY 2014-15.
2. At the outset, we observe that there is delay of 10 days in the filling of the instant appeal, which resulted into on account of illness of the Ld. AR. Considering the delay and the reasons disclosed by the Assessee, as genuine, the delay stands condoned
3. Coming to the merits of the case, we observe that the Assessee being a partnership firm engaged in the business of construction activities as a builders and developer, had shown its total income at Rs. „Nil‟ by filing its return of income for the AY under consideration on dated 26.11.2014, which was selected for scrutiny under CASS. During the assessment proceedings, the assessing officer on verification of copy of sale agreements executed by the Assessee during the AY 2014-15, found the Assessee has executed 3 sale agreements, out of which sale consideration received by the Assessee for 2 agreements/properties was less than the stamp duty valuation which are detailed below:-
